Digital transformation best practice thoughts

Over the last five years or so, there has been rapid evolution in the number of technologies that promise to disrupt established ways of doing business and mean that all organisations driving new initiatives should always take a Digital First approach. Evolution in mobile, social media, cloud and big data are revolutionising the way consumers interact with each other and the companies they do business with and consume services. This is creating huge new opportunities and threats for most enterprises. Consumers of all ages are gaining familiarity and comfort with a wide range of digital channels and are increasingly expecting high standards of digitisation.

There are many potential benefits and challenges for enterprises in becoming fully digital. Digital technologies are being used to automate processes throughout an organisation and change the way that employees communicate with customers, each other and how they collaborate. Lean new entrants are creating compelling digitally based propositions for customers, often using digital platforms for global reach but maintaining extremely low cost bases. Therefore embracing digital, in all its facets, must be a key priority for any organisation.

Transitioning to a digital enterprise

Transitioning to a fully digital enterprise requires a mixture of capabilities. It needs the right leadership, strategy and vision and will inevitably mean cultural and organisational changes. It will need a new and unfettered way of generating and executing ideas. It will need strong focus on the end-to-end customer experience your organisation creates. Whilst you may want to, or already be developing, siloed digital capabilities, you will also need a way of governing your digital investments differently to other initiatives and aggregating the capabilities you build into a digital platform that is easy and quick to change and evolve. You will also need to build in ways of capturing customer and employee feedback quickly and then rolling out new capabilities in days or weeks, not months or years.

This short paper summarises our thoughts about how best-in-class digital companies are becoming digital in a few key dimensions:

The intent of this paper is to serve as a taster for some of the key issues that need to be addressed in each of these areas.

Leadership, Vision and Strategy

It is important to have a clear business digitisation strategy, driven from the very top of the organisation. The strategy should be enterprise wide though the implementation or transition toward the strategy can and should be phased and iterative. Clear goals should exist for each business unit and expected business benefits from digitisation should be stated, measured against and evolve to reflect rapid changes in digital capabilities and trends. Governance has to reflect the need to trial new technologies and techniques and approaches for reducing time to market and for testing response, collecting feedback and evolving digital applications rapidly. It is important that governance process reflect the need to pioneer, accept small failures, learn fast and continually evolve the ideal mix of digital capabilities for your organisation.

Not only is it important to quickly develop digital solutions from within each business unit, it is critical that the business takes an enterprise wide view of the digital roadmap and transformation capabilities it needs to develop to become fully digital. Research by Cap Gemini has shown that those organisations that invest in digital applications generally deliver 9% more revenue than those that do not, whilst those that are successfully transforming their entire organisations to a digital first approach can deliver up to 26% more profitability.

Also, bear in mind, a digital strategy and roadmap should be continually evolved to ensure it takes into account rapidly changing trends, technologies, competitive pressures and market conditions.

Execution and Delivery

Rapid Execution and Delivery of digital initiatives is vital. Does your organisation have an efficient way of generating ideas for digital initiatives and can it execute on these quickly. The process used for developing a digital initiative must be designed from a complete User Experience perspective and delivered using a highly iterative and agile based delivery methodology.

Time to market must be as short as possible. Once live, you must constantly monitor usage and actively seek feedback from customers and have a steady flow of new features and functionality and be bold in trying out new features and then listening for what customers think and deploying changes quickly.

Agile engineering practices such as Test Driven Development, Continuous Integration and Deployment and Test Automation delivering in short iterations will help keep time to market to a minimum and keep code quality high as well as helping you quickly make and roll out changes in your digital applications and solutions.

Many organisations start their digital initiatives within particular business units. However, it is important that the customer sees an end to end, joined up digital experience. Therefore, delivering digital initiatives through an overall digital platform which you can continually evolve and through which you can package and present services from back end, partner and third party systems will help ensure that investments in particular business unit initiatives can be deployed enterprise wide.

Organisation and Cultural Change

Any organisation that has been in business for some time will need to think about how it increases focus and importance on digitisation from an organisation and a cultural perspective. Established processes and knowledge workers can stifle innovation and entrepreneurial spirit. Businesses need to promote an entrepreneurial culture across the organisation. Many lean, innovative digital start-ups are already revolutionising industries and companies such as Blockbuster are no longer in business as they failed to see where their industry was heading.

Your organisation will need to adopt an entrepreneurial mindset and embed it in its culture. Your staff are already using digital technologies to make gradual but significant changes to their daily lives as consumers, they are going to expect the same as employees. They will have ideas. Leading digital companies are trying out digital technologies to revolutionise the way employees collaborate and communicate. They are also ensuring that digital ideas are captured, prioritised and harnessed.

Let your employees know that from now on, you want them to think and act like digital start entrepreneurs and to bring ideas and then ensure you have governance that invests in those ideas.

Organisationally, it must be clear that digitisation is supported from the top and the board is focussed on securing the right digital future for the company. Many organisations are creating the role of Chief Digital Officer (CDO), others are embedding the digitisation responsibility within various senior roles. Whichever way you do it, building an organisation with the structure and mindset to think and act like a digital entrepreneur is key to success.

Digitising the Customer Experience

The Customer Experience is one of the first places companies look at for rapid Return on Investment for the digital initiatives. Great benefits can be had from digitising the way customers engage with your organisation and deliver benefits such as increased automation, improved quality, reduced costs and a better overall customer experience and positive brand perception.

Customers expect to be able to engage digitally with your organisation across all touch points and also expect that you can use all the data you have about them to personalise their experience and fill in forms automatically, provide service or product recommendations that are relevant and context sensitive.

Best in class digital companies are digitising the entire customer facing processes across all channels and across all parts of the enterprise to provide a consistent experience. They are also making previously internal only processes available to customers to increase the level of self-management customers can undertake.

They are also integrating partner companies in their business processes to provide real value-add to customers or potentially, new services or value propositions.

Using big data capabilities, companies can analyse the huge amounts of information being created by digital transactions across all channels and see how customers react to automated services is essential in innovating the customer experience. So too is using social networks to solicit feedback, try out new offers and gauge customers reactions to new innovations.

Building a Digital Platform

When building digital solutions, it is best to build a digital platform upon which, new code is written but which interfaces to all key services in legacy and 3rd party applications. The platform should interface to all social networking platforms and support engagement with customers through any channel and any device. It should also be cloud based and built to capture the huge amount of information generated in a digitally enabled business. A data analysis engine should be part of the digital platform using appropriate Big Data databases and both real time and batch based analytics so your organisation can respond to real time transactions/postings being made by your customers but also to analyse the huge amounts of digital information to lean new and interesting emerging trends and business insights.

Organisations excellent in this category are using NoSQL databases to find interesting relationships between seemingly unconnected data to better understand their customers and their businesses.

They are also automating processes as much as possible to support a truly rich digital customer and partner experience. This includes automating knowledge based processes.

They are of course making use of cloud based technologies to drive down cost and speed time to market and provide massive scalability. They are using best of breed, proven open source tools for much of the interfacing to legacy and third party applications.

Summary

The digital future is here now and digital transformation must be a top agenda item for any serious organisation. Huge opportunities exist for those that invest in the right digital initiatives for their industry and organisation and these are not just in the customer experience but also in efficiency, productivity and employee collaboration and communication. Opportunities exist in all industries and transformation toward digitising the business and taking advantage of these opportunities must always led from the top of the organisation. This paper highlights some of the considerations and best practice approaches being taken by digital leaders.

Author

Ian Southward

Managing Director – Commercial at Arrk Group, Ian has over 30 years experience in banking and IT and for the last 12 years, has worked in custom software development advising clients with respect to Agile and Lean based delivery using onshore, offshore and distributed teams.

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